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Yahoo Spent $79 Million To Fend Off Microsoft
Apologetics Blog writes "Getting bought by one of the biggest companies in the world turns out to be a rather costly thing. Last year when Microsoft was in talks with Yahoo regarding a possible buy-out, in a report recently filed with the Securities and Exchange Commission, Yahoo announced that it cost them $79 million to fight off Microsoft. Most of that money was spent on advisors who examined Microsoft's proposals, and the way it would impact on Yahoo's search agreement with Google. The deal fizzled out when federal antitrust regulators said it would challenge any deal made between the two companies."
Shows that consultants win, as they so often (always?) do
Does Yahoo! have a viable business plan besides merging with someone else at some point? If I was one of their shareholders I might have gotten pretty annoyed that they dismissed the MSFT offer out of hand the way they did. What's the future of Yahoo! without a merger? They have a platform in the works that can pose a serious challenge to Google and secure marketshare against them or Microsoft? Didn't think so.....
I want peace on earth and goodwill toward man.
We are the United States Government! We don't do that sort of thing.
I could be wrong but wasn't Google trying to buy Yahoo as well but got stopped by the regulators because then google would be considered too big? Nice to see that the door swings both ways. If you ask me Yahoo is the one that really got hurt in all this. I guess the lesson is never get in between two giants battling it out. ;)
Getting bought by one of the biggest companies in the world turns out to be a rather costly thing.
That should read "Not getting bought out..." since the deal never went through. If they had only just given in to Microsoft... then all it would have cost them is their souls.
The $79 million dollars of advice was ordered by and for the previous CEO, Jerry Yang. The new CEO, Carol Bartz, is a different kind of business person. She doesn't need $79 million dollars of advice to talk with Microsoft.
$79 million for advisors? Seriously?
I think I'm in the wrong line of work.
Can anyone explain that to me?
How can that possibly cost that much?
The $79 million dollars...
79 = seventy-nine
$79 = seventy-nine dollars
$79 million = seventy-nine million dollars
$79 million dollars = seventy-nine million dollars dollars
here is the link to the atricle that actually talks about the $79 Million dollar tab, with all sorts of links to all the related article stuff...
http://news.cnet.com/8301-1023_3-10184454-93.html?tag=mncol;posts
1.) Immediately investigate Jerry Yang's connection with the "advisors".
2.) Ensure that the current CEO understands that any future "advisment" of this nature will come out of her pension.
That's $215K per day for a whole year !
Do you expect me to believe that the 100 top flight lawyers and accountants were working every day of the year on this ? Or did they just hire Accenture ?
If MS takes Yahoo! over they succeed in their long term goal of a takeover.
If MS fails, like what happened here, there was still a short term gain for MS, as Yahoo! was 'forced' to spend $79 million on keeping MS at bay. Regardless of how people fell about Yahoo! overspending for their consultants, they still would have had to allocate some money that would have been used for other services or generating new content and ideas.
This means Yahoo! was forced to expend a significant amount of money and that they take a moderate hit in the media publicity wise as this brings up the news that Yahoo! faltered enough to have a takeover a possibility, and it shows that Yahoo! might have used erroneous amounts of funds warding off said takeover. Though perhaps any amount of money is worth it to keep MS from taking over your company.
Writer Dawn Kawamoto from CNet sums the situation up nicely:
For Yahoo, however, the true cost was much greater than just $79 million.
In the process, Yahoo founder and CEO Jerry Yang stepped down after enduring the brunt of shareholder anger and has since resumed his role as chief Yahoo. Sue Decker, who was Yahoo's president during the tumultuous year, lost out her bid to become the next CEO when Yahoo's board named former Autodesk chief Carol Bartz to oversee the troubled Internet company. And Yahoo saw an exodus of executives in June 2008.
When our company took over a company worth £43mill it cost us £1mill in legal fees etc. etc. to get everything looked over and sorted out.
I think for something of Yahoo's worth, $79 million isn't massively unrealistic. I'd say it's not unreasonable either, it is to most people including me, but in the world of business I'd say it's probably not.
Still Yahoo, perhaps the most business plan challenged IT company in the last few years, turning down Micrososft, going for Google, getting told to f off by Google because of the potential for monopoly problems and then running back to Microsoft and being told to f off by Micrososft too.
Ballmer is probably laughing his arse off, they offered over the odds to pay for the company but if they had paid that much and then seen the resulting decline of it's worth due to a number of factors from Google to the financial crisis then they'd have wasted literally billions.
Yahoo should have just let business happen. Being eaten by Microsoft is not always a bad thing /.'rs make it out to be.
...a pointy stick.
If you're not part of the solution, there's plenty of money to be made prolonging the problem.
http://despair.com/consulting.html
Does anybody at Slashdot ever actually check *anything* before they post?
"The deal fizzled out when federal antitrust regulators said it would challenge any deal made between the two companies.""
The link is about the deal between *GOOGLE* and Yahoo!. Google != Microsoft.
The deal between Yahoo! and Microsoft fizzled out because Yang did everything he could to prevent it, not because of antitrust concerns.
Sounds more like Yahoo is cooking the books a little bit to hide some losses, instead (creatively) funneling it into this consulting gig.
"But a loss on the balance sheet is still a loss, right"?
Not exactly, when PR and taxes are concerned.
Meh, that's probably less than Microsoft's annual budget for office furniture, especially chairs. Now, Google might be a different story.
I have an MBA... I could have told them how to royally screw their investors for no more than $78 million...
The way I read it, there's a lot of fees rolled into one.
Some of you may ask why so many lawyers. Well there a 3 separate legal issues here. Fight MS, Deal with Google, and fight Carl Icahn. You might get the same lawyers to fight MS and figure out the Google deal, but they really are different areas of the law and the large scope would mean you need more more bodies. For the proxy contest, you probably want a law firm that specializes in that.
Well, there's spam egg sausage and spam, that's not got much spam in it.
Federal regulators said they would challenge any deal between Yahoo & Google, not Yahoo & Microsoft.
Microsoft is the worlds 136th largest company
> The deal fizzled out when federal antitrust regulators said it would challenge any deal made between the two companies. The way I understand it, the deal actually fizzled out because some Yahoo C-level egos couldn't agree on a valuation with Microsoft. Yahoo, whose stock currently trades for $12.60, wouldn't sell to MS for $33 / share because they felt they were worth $37 / share, and also because they are idiots. Slashdot actually covered this story at the time.
If it costs you over $70 million to figure out how being acquired by Microsoft would effect your agreements with Google, shouldn't you begin to suspect your agreements with Google are too fucking complicated? Especially when a simple Google search would tell you how Microsoft feels about Google
I've abandoned my search for truth; now I'm just looking for some useful delusions.
These appear like real-life versions of a DOS and an injection attack. Along similar lines, the FAT lawsuit against TomTom looks also like a case of doing damage for that sake of damage.
Beta is broken and the link to classic doesn't work. Stop wasting our time or there won't be anybody left here.
The $79 million was not due to the size of Microsoft, as the summary implies. It was because of the size of Yahoo. A small company would not have to spend $79 million to figure out the impact of MS buying it.
Currently hooked on AMP
... never get in between two giants battling it out. ;)
Sounds just like what I do on the toilet bowl every day.
Or what the lucky married men do every night.
but if those odds of success were AT ALL any good, microsoft would have a better search by now than the shit they had for aeons. they dont. they didnt improve. i dont see the trend changing.
you dont need to have a 'product' on drawing board to make money. most of the internet businesses sell SERVICES, ADS and etc and make profit. all yahoo needs to do is to become profitable and earn money. not be 'innovative' and create products etc.
Read radical news here
I think one thing people keep forgetting is that, the $33 is a misleading figure. Only half of the amount was in cash, and the rest in MS stock. Given the complexity of the deal involved, and the monopoly concerns (MS and Y! are big players in instant messaging and mail), the deal would have been AT LEAST a year to happen. And look at what MS price is a year after that (nearly down by 50%), so the effective price for the shareholders would have been $24-25, and not $33.
This is of course, assuming that the deal would not have changed the price of MS at all, but I think it would have negatively impacted MS because they would not be cash-rich any more, and the integration issues of such a large size are going to bog down any company.
I'm much more funny, interesting and insightful than the moderators think